US health care costs more

May 26, 2017

The latest data confirms that the United States spends more on health care when compared to other countries, and points to the their higher price for many procedures, diagnostic tests and drugs as being a main cause.

The International Federation of Health Plans (iFHP) used data from 2015 that examined detailing its annual survey of medical prices per unit. The federation annually surveys prices that are actually paid for selected health care goods and services in the different countries.

Health care costs are complicated and why the US spend is so high may not be easy to narrow down to a single cause but the iFHP data does highlight that a higher health spend is not always closely related to a higher supply of health human resources or to a higher supply of physical and technical equipment in health systems.

The report showed that Humira, a drug prescribed for rheumatoid arthritis has prices ranging from $552 in South Africa to an average $2,669 in the United States. OxyContin cost less than $36 in Spain but cost an average $265 in the United States.

Hospital costs vary dramatically within the United States, from between $17,358 to $1,494 but is an average of $5,220, only just behind Switzerland at $4,781. Australia came in at $765 per day.

It is interesting to note that the latest data from the Organisation for Economic Co-operation and Development (OECD) shows that the United States, has the level of spending on pharmaceuticals twice the OECD average, more than 35 per cent higher than in Japan, the next highest spender.

The US continues to spend much more on health per capita than all other OECD countries but is not in the top group in terms of the number of doctors or nurses per population.

The OECD also reveals in the United States, the gains in life expectancy over the past few decades have also been more modest than in most other OECD countries. While life expectancy in the United States used to be one year above the OECD average in 1970, it is now more than one year below the average. Many factors can explain these lower gains in life expectancy.